War Shuts Critical Strait, Oil Prices Near $120

The US-Israel war against Iran that began February 28 has caused the largest oil supply shock in history, sending Brent crude prices from around $72 to nearly $120 per barrel. The conflict killed Iran's Supreme Leader Ayatollah Ali Khamenei and sparked retaliatory strikes that effectively closed the Strait of Hormuz, a critical chokepoint handling roughly 20% of global oil supply. Oil prices surged 55% since the start of the war, with Brent posting one of its largest one-month gains at 51% in March. The war has triggered significant consumer-level impacts across Western nations. UK petrol prices rose from £1.33 to over £1.58 per liter, driving a 27% spike in "fill up and flee" thefts costing the sector over £100 million annually. US gas prices jumped from under $3 to over $4 per gallon, with incidents of thieves drilling vehicle fuel tanks to steal fuel. European diesel prices surged up to 40% in Germany, while electric car sales across continental Europe rose 51%. US-Iran negotiations are ongoing in Pakistan amid a fragile ceasefire, with markets bracing for continued volatility as the two-week truce approaches expiration. Market analyst Rory Johnston said any reopening of the Strait would trigger an immediate $10 to $20 crude price drop, but warned relief would be temporary as supply chain bottlenecks and infrastructure damage would likely keep Brent anchored between $80 and $90. Russia has largely insulated itself from the crisis, with domestic petrol prices holding steady around 68 rubles per liter as Deputy Prime Minister Novak banned gasoline exports to protect local supply.